China’s post-pandemic economic recovery spurs growth across internet sector, boosting e-commerce, ride-hailing and online travel: report

The survey findings published on Monday by the China Internet Network Information Centre (CNNIC), an agency under the Cyberspace Administration of China, showed that the total number of internet users nationwide reached 1.08 billion as of June, an increase of 11.09 million from December last year, to put the nation’s online penetration rate at 76.4 per cent.

Online retail sales in the first six months of 2023 amounted to 7.16 trillion yuan (US$983 billion), up 13.1 per cent from the same period last year, according to the CNNIC, which has been conducting twice-a-year surveys of the domestic internet sector since 1997. The number of online shoppers nationwide reached 884 million as of June, following the addition of 38.8 million new users in the first half.

During the same period, ride hailing and online travel were China’s two fastest-growing internet market segments in terms of user scale, according to the survey. Ride-hailing services added 34.92 million new users, while online travel saw a 30.91 million increase.

China’s e-commerce market saw total sales grow 13.1 per cent year on year to US$983 billion in the first half of 2023. Image: Shutterstock

The CNNIC report highlighted the role of digital infrastructure development in the internet market’s growth. It credited the continued roll-out of mobile base stations for helping drive app usage across the country, which is the world’s largest smartphone market.

The number of mobile base stations nationwide reached 11.29 million as of June, with 5G base stations accounting for 2.94 million or 26 per cent of that total, according to the CNNIC report. 5G subscribers on the mainland numbered 676 million as of June.

In the first half of 2023, the number of active apps monitored in the domestic market amounted to 2.6 million, which the CNNIC said covered “the daily study, work and life of netizens”. But that total was down from 3.5 million apps in 2020, before Beijing’s regulatory crackdown on the internet industry.

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The number of short video users nationwide reached 1.026 billion as of June this year, accounting for 95.2 per cent of the nation’s internet users, according to the CNNIC survey.

In terms of popularity and scale, the short video market segment ranked behind instant messaging and the longer-format online video services.

Instant messaging had 1.047 billion total users at the end of June, representing 97.1 per cent of the country’s internet population. Online video had 1.044 billion in the same period, making up 96.8 per cent of the total online population.

The CNNIC report also indicated that rural e-commerce has further developed on the back of the country’s mobile infrastructure buildout and greater logistics coverage. Online retail sales in rural areas crossed 1.12 trillion yuan in the first half of 2023, up 12.5 per cent from a year earlier.

There was also rapid development in the country’s industrial internet efforts, according to the report. It said there were more than 240 “industrial internet platforms with some influence” as of June, while a nationwide industrial big data system was in the process of completion.

South China Morning Post